The fate of the 26 French Galeries Lafayette stores under safeguard procedure is currently in the hands of the Bordeaux Commercial Court. Owned by Bordeaux businessman Michel Ohayon, these stores are facing financial and structural difficulties, jeopardizing their future and that of their employees. The court’s decision, expected before February 22, will have a major impact on the commercial landscape of the town centers concerned, and on local employment.
This Wednesday, Valentine’s Day, the Bordeaux Commercial Court will be considering the fate of 26 Galeries Lafayette department stores across France. These establishments, employing over 1,000 people, are at the heart of a legal and financial battle that could seal their future.
The case involves Michel Ohayon, owner of these 26? stores, which were sold by the Galeries Lafayette group. This retail complex was a mainstay of the Bordeaux businessman’s commercial empire, which also included other acquisitions. However, recent setbacks, such as the liquidation of Camaïeu and the resale of Go Sport, Gap and La Grande Récré to competitors, have highlighted the entrepreneur’s financial difficulties.
Beyond the financial implications, this case has a political dimension, as these department stores are major players in several French regions. The image of the Galeries Lafayette group, which sold these underperforming stores, is also at stake. Michel Ohayon, whose initial ambition was to revitalize downtown retailing, now finds himself in a critical situation.
Long-standing difficulties
The group would probably never have anticipated such a series of setbacks when, in 2018 and 2021, Michel Ohayon acquired the goodwill of these 26 Galeries Lafayette stores. These were then operated as affiliates (franchises) through Hermione Retail, with the simultaneous purchase of all the retail premises. These assets were then grouped together within its Financière Immobilière Bordelaise (FIB), itself facing financial difficulties.
At the time, the 60-year-old’s stated aim was to revitalize the retail sector in small and medium-sized town centers. However, five years on, the reality is very different. In February 2023, a safeguard procedure was launched for all 26 department stores. Many of them were in need of major renovation, and some were even in critical condition. High rents, lack of investment and mounting debts are all factors raised by employee representatives and other industry observers.
Total debts amount to 153 million euros. The business continuity plan presented by Hermione Retail envisages writing off 70% of these debts, with the remainder to be spread over a ten-year period.
The safeguard plan gives cause for concern
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Featured photo : © Galeries Lafayette
